General liability insurance for contractors covers third-party bodily injury, property damage, and completed-operations claims arising from construction work. Every general contractor requires it from subcontractors before they set foot on a job site, and most states require it for contractor licensing. The standard limits are $1M per occurrence and $2M aggregate, though commercial projects frequently require higher limits through an umbrella.
For contractors financing equipment or property through SBA loans, SBA hazard insurance requirements add coverage obligations beyond standard GL.
Key Takeaways
- Standard limits: $1M per occurrence / $2M aggregate — most GCs require this minimum from subs
- Cost by trade: $700–$3,000/year for low-risk trades; $3,000–$10,000+ for roofing, demolition, and heavy construction
- Products-completed operations: Covers claims from finished work — critical for callbacks and post-completion defects
- Additional insured: GCs must be named on your policy as additional insured — standard requirement
- Umbrella required: Most commercial projects require $2M–$5M umbrella on top of GL
Frequently Asked Questions
How much does general liability cost for contractors?
Low-risk trades (painting, carpentry, electrical) pay $700–$3,000/year. High-risk trades (roofing, demolition, excavation) pay $3,000–$10,000+. Cost scales with revenue, payroll, trade classification, and claims history.
Disclaimer: This article is for informational purposes only and does not constitute insurance or legal advice. Consult our licensed advisors for guidance specific to your business.
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